QFF and partners, Uni SQ, Willis Towers Watson and CelsiusPro are developing parametric solutions to support the resilience of farmers to weather risks. The project funded through the Australian Government Future Drought Fund Innovation Grant, investigates parametric insurance as a risk management tool to enhance yield potential and profitability.

To learn more about the project contact Project Manager, Kerry Battersby Kerry@qff.org.au or Project Officer – Farm Business Resilience, Bec Tkal rebecca@qff.org.au.

Queensland farmers are subject to highly variable climatic conditions, including droughts and floods, which can decimate production and challenge farm viability. Insurance could play an important role in helping Queensland farmers manage their climate risk. However, the use of insurance to manage climate-related production risk is currently poorly understood and utilised by farmers.

Funded by the Queensland Government, the project conducted focused reviews on climate risk in agriculture and how insurance products could be used to address these risks. Based on these reviews, prototype insurance products have been developed to manage these identifiable climate and weather risks for farmers.

The project is currently developing industry-specific case study examples of how the product works and pricing it up.

The objective of this project was to improve the understanding of agricultural insurance and assist with the initial development of new products that met Queensland farmers’ needs through the provision of data, education and extension.

The project demonstrated that the initial development of an insurance product was possible with quality base level data and agricultural industry support.

The work conducted in this area is predicted to have flow-on effects in strengthening partnerships with the insurance sector and individual agri-focussed companies.

Specifically, the project undertook:

• Industry and farm data collection in the Queensland stone fruit industry;
• Risk identification and risk management information for the Queensland stone fruit industry;
• Industry and farm data collection in the Queensland summer grains industry;
• Risk identification and risk management information for the Queensland summer grains industry;
• Educational presentations to farming industry organisations and farmers about agricultural insurance; and
• Providing risk identification and management information provided to the insurance sector.

Through the use of satellite imagery and available data from Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) and the Australian Bureau of Statistics (ABS), the project will establish a time series of commodity maps and yields over a 20 year period (1997-2017) within the Darling Downs region.

The project will provide indispensable baseline information required by insurance companies willing to expand current offerings to new regions and commodities or develop and offer new agricultural insurance products to Queensland Producers.